Consider Bird grounded. The scooter-riding company, which was once a high-flying transport company, filed for bankruptcy. In his paperworkblamed the company on huge losses—$235 million and $471 million in 2021 and 2022, respectively—plus a post-Covid slump in ridership, and more than 100 personal injury lawsuits.
The company is looking to shed somewhere between $100 million and $500 million. Its largest non-lender creditor, owed nearly $5 million, is Amazon Web Services. But elsewhere on its long list of parties waiting to be repaid, more than 300 municipalities and governments, from Maine to California to Canada to Australia, are a sign of how far the company expanded before it had to strike.
A noble beginning in the mobility business
Founded in 2017, Bird was an early entrant in the so-called “micromobility” category. Founder Travis VanderZanden, a former Uber employee, developed his first herd in Santa Monica. The premise was that short-range motorized scooters, which could travel a dozen kilometers or so on a charge, could help people get where they needed to go faster without a bike. Riders could pick them up wherever they could find one, and drop them off whenever and wherever they needed to.
“We know the city has parking and traffic issues like the rest of LA,” he told the Santa Monica Daily Record at that point. “We feel that this is a great city for all of these reasons and we feel that Bird can have a huge impact on traffic and parking.”
In the same write-up, Santa Monica Mobility Manager Francie Steffan gave the scooters a tentative embrace. “The most healthy way is to offer a variety of options that coexist for the long term,” she said.
Eventually the scooters drifted back to VanderZanden’s old stomping grounds in the Bay Area. where they were a hit. It was an idea that many people were into, especially investors with a lot of money to throw around. In 2018, Bird was the fastest US startup ever to secure a $1 billion valuation and become a so-called unicorn.
Bumps in the road
Not everyone was on board from the start. In February 2018, Bird paid a $600,000 fine and pleaded no contest to charges from his hometown of operating without a license and failure to comply with city-issued citations. That April, the San Francisco city attorney sued Bird and similar scooter-sharing companies like Lime a cease and desist order. People were ride the scooters on the sidewalkand to leave the scooters in the way of people on foot or in wheelchairs which was necessary, while scooter riders without safety equipment get hurt and die.
Like its car-based ride-sharing counterparts, Bird has a asking-forgiveness-not-permission tack on expansion. In his 2022 annual report, the company said it operates in more than 350 markets. Very went along with the scooters’ popularity, enter into partnerships to promote their use. Others decided they didn’t want to deal with all the trouble: Earlier this year, Parisians overwhelmingly voted to ban scooter sharing companies from city streets.
A short drive in public markets
Regulatory problems notwithstanding, and despite early pandemic era pressure on incomeBird submitted to go public in 2021 at a valuation of $2.3 billion. But it was no longer a buzzy start. Not only was there more competition, but many people’s “back to normal” post-vaccination meant they were driving or taking the train, not riding. The company’s stock has been falling almost continuously.
Crunchbase figured out that by the fall of 2022, VanderZanden’s stake was worth less than a house he bought in Miami. Soon it was delisted from the New York Stock Exchange. Around that time VandenZanden was pushed out of the CEO position. It’s embarrassing that the company announced in November 2022 overstated his revenue numbers in its annual reports.
And now it’s bankrupt. It filed for Chapter 11, meaning the company will try to pay off some of its debt and give scooter sharing another shot after a reorganization and a fresh start.
“This announcement represents an important milestone in Bird’s transformation,” interim CEO Michael Washinushi said euphemistically in a company statement announcing the bankruptcy. “We remain focused on our mission to make cities more livable by using micromobility to reduce car use, traffic and carbon emissions.”
